U.S. insurer Travelers’ profit beats on lower catastrophe losses
2022.04.19 14:22
FILE PHOTO: The logo of Dow Jones Industrial Average stock market index listed company Travelers Companies Inc (TRV) is seen in Los Angeles, California, United States, April 27, 2016. REUTERS/Lucy Nicholson/File Photo
(Reuters) – Property and casualty insurer Travelers Companies (NYSE:TRV) Inc reported a 48% jump in quarterly profit that beat analysts’ estimates on Tuesday, as lower catastrophe-related claims cushioned a hit from investment losses.
The company’s core income rose to $1.04 billion, or $4.22 per share, in the first quarter ended March 31, from $699 million, or $2.73 per share, a year earlier.
Analysts on average had expected a profit of $3.57 per share, according to Refinitiv IBES data.
New York-based Travelers, often seen as a bellwether for the insurance sector as it typically reports before its industry peers, said net written premiums rose 11% to $8.37 billion in the quarter.
The insurance industry had over the past two years faced claims from businesses losing revenue because of the coronavirus-led crisis and canceled events among others, even though many have been insulated by virus exclusions in their contracts.
While pandemic-related claims have slowed, the insurance industry now faces hefty claims from the Ukraine crisis as sanctions ratchet up and the war drags on.
S&P Global (NYSE:SPGI) said earlier this month insurance losses from the Ukraine conflict could total $35 billion, with cyber one of the classes of insurance most exposed.
Travelers’ underwriting gains rose to $659 million from $217 million a year earlier, while pretax net investment income fell 9% to $637 million, hurt by a decline in income from the insurer’s non-fixed income investment portfolio.
The company reported a combined ratio of 91.3%, compared with 96.6% a year earlier. A ratio below 100% means the insurer earned more in premiums than it paid out in claims.
